Pricing your services. One of the most important items you’ll ever need to consider as a service provider that’s self-employed
Getting your price point right is crucial to your business success.
It’s also the area that can give you the biggest headache…believe me, I know this from personal experience.
The million dollar question!
What price should you charge?
Depending on your industry and qualifications there are some standard rates….but, the real dilemma is this…
Making sure you are charging what is right for you. For your business. Not just going with what is considered standard or the going rate.
Working in the corporate world, there are things like awards, employment contracts, and benchmarks against which salaries are set. So as an employee you don’t really need to think about this stuff too much.
But, once you step out on your own, it’s a lot different.
It can be a minefield…lots of traps to fall into and mistakes to make.
One of the most common ways is by comparing what everyone else in the marketplace is charging. But let’s be real….in the service industry, it’s really quite hard to compare.
You’re not here to be a copycat.
Being in business for yourself means doing things your way. Doing what’s right for you…after all, isn’t that why you’re working for yourself?
This may not be what you want to hear…but if you’re just starting out unless you already have a stellar reputation and following, you’ll probably need to start off at a lower price.
This does not mean undervaluing yourself.
A far better way of figuring out how to set your fees and charges is beginning with a basic price point and building from there.
The tricky part is always working out your personal basic price point. Downloading this handy tip sheet will help you enormously..
Once you have the basic (minimum) price point from which you need to operate, you can actually use how you price your services as a way to grow your business.
That does not mean you are going to be working at the minimum price point.
It’s about giving you a realistic figure from which to build. You need this baseline so you can be ready to implement an effective pricing strategy.
An effective pricing strategy will help ensure that you are charging what you is right for your business.
A pricing strategy involves:
1) Your selling sequence (how to position services; how to position pricing)
2) Your target market (who you sell to now and who you want to sell to in the future)
3) Your competitors (making yourself competitive other than through pricing)
4) What the market will bear (this is the exciting bit that moves you into the premium price point!).
But it all starts with the basic fees.
No matter what line of business you’re in how you work out your service fees are exactly the same.
Michelle Hanton is a multi-award winning bespoke business strategist, working internationally as a consultant, coach, speaker and writer. She has a keen interest in the not-for-profit sector and is the former CEO of Lifeline Top End, and founder of Dragons Abreast Australia, a national charity dedicated to the promotion of breast cancer awareness.